Tag Archives: FWA

An employer has been ordered to pay nearly $40,000 in compensation to a former employee following an unfair dismissal hearing – the arbitrator said the employer’s response had, from the very outset, “no reasonable prospect of success”.

In the case of Stan Kunce v Deliver Australia Pty Ltd (U2012/6097), Fair Work Australia found that while the employer had lodged material in response to an unfair dismissal claim, on the day of the hearing it withdrew its witnesses and failed to make any submissions.

The employer was represented by its HR manager, and Commissioner Bissett was scathing of the manager’s preparedness. “The only motive that can be attributed to the (employer) for its behaviour in the hearing is that it maintained its opposition to the claim of the (employee) when, on some reflection in the days prior to the hearing, it was apparent that its position was not defensible,” Commissioner Bissett said. “It was only after the decision was made and the order for compensation was issued did the (employer) seek to engage in dialogue with the (employee) on some other basis for settling the claim,” she added.

The Fair Work Act allows for one party to pay another party’s costs if their application (or response to an application) is vexatious, without reasonable cause or where it should have been apparent that is had no reasonable prospect of success.

In this particular case, the unfairly dismissed employee submitted that the employer changed the reasons it relied on for termination, produced no evidence in relation to its reasons, failed to cross-examine its own evidence and provided “limited” submissions in its defence. As such, the former employee argued that the employer’s lack of response could be seen as acceptance that it had little chance of success. “Whilst the [employer] now pleads naivety and inexperience with tribunal procedures, no such matter was brought to the tribunal’s attention during or prior to the hearing,” Bissett found.

The employer has some 40 employees on staff, and the HR manager had ample opportunity to seek advice or assistance prior to the hearing, but chose not to. Bissett found that while the reasons for termination weren’t changed as alleged by the aggrieved employee, it must have been ‘reasonably apparent’ immediately before and during the hearing that the employer’s response had no reasonable prospect of success.

In making her decision, the arbitrator took into consideration the employer’s apparent lack of knowledge of the tribunal procedures, but was also mindful that having withdrawn its witnesses the employer was aware, by its response to questions by the tribunal, that without its witnesses it could not substantiate its allegations. “Ignorance, however, can be no satisfactory defence against the claim for costs,” Bissett ruled.

Commissioner Bissett ruled that the employer pay costs incurred the day before and on the day of the hearing.

HR takeaway

The case serves as warning for HR to assess the risks that can come with defending claims. All up, the employer was ordered to pay the maximum penalty of 26 weeks’ pay, coupled with the costs for representation during the hearing. It’s important to seek accurate, strategic advice as soon as a claim is received to ensure risks are minimised.

Both parties in the Qantas dispute have been ‘bloody-minded’. Photo: James Davies

FAIR Work Australia’s monumental rebuff to the Transport Workers Union in its dispute with Qantas strikes a blow to the credibility of claims the Fair Work Act is some kind of conspiracy against employers.

The commission (which is what Fair Work Australia is in all but name) had no choice last week but to support Qantas management because, in both its tactics and its demands, the union was being so bloody-minded.

That’s true even though, by grounding its planes worldwide and locking out all its staff last October, Qantas management could come up with no more creative solution to its bargaining problem than to be as bloody-minded as some of its unions.

This was not so much a win for ”managers’ right to manage” as the commission’s commonsense judgment that allthe industrial parties needed to face up to the harsh commercial realities threatening the survival of their business.

Here we had a union demanding 5 per cent annual pay rises at the same time it was fighting to prevent its employer from turning to cheaper sources of labour. That makes sense?

It will be a pity if the commission’s refusal last week to split the difference in the old way encourages other militant employers to seek to resolve disagreements with their workers the chaos-causing Qantas way. Even so, the commission’s refusal to go anywhere near splitting the difference provides powerful evidence it can be trusted to adjudicate issues sensibly in a system that hasn’t swung the balance too far the unions’ way.

Perhaps this explains why the national dailies – which, in their campaigning against the evils of Fair Work, seem to find another story about union atrocities for the front page most days – were not excited by the employers’ big win last week.

Read too much of their stuff and you come away thinking the union movement has risen from its death bed to pose the greatest threat to our continued prosperity. Remember, union membership is down to 18 per cent of the workforce (from 50 per cent in 1982) and 14 per cent of private-sector workers.

Another figure to keep in mind when you read about the union monster poised to eat the economy’s lunch: more than 80 per cent of enterprises don’t have a union presence.

Two labour lawyers, Dr Anthony Forsyth, of Monash University, and Professor Andrew Stewart, of Adelaide University, note in their submission to the Fair Work review that ”the concerns about union activities that so animate certain employers in the resources, manufacturing and construction sectors are very far removed from the issues confronting businesses in other parts of the economy”.

”For the small to medium enterprises that predominate in sectors such as retail and hospitality, both unions and, indeed, collective bargaining are largely absent. Their concerns are much more likely, in our experience, to revolve around the costs and ‘inflexibilities’ imposed by the award system, and the renewed exposure to unfair dismissal claims that the Fair Work Act has brought.”

So far, Fair Work has failed in its aim to greatly increase the extent of collective bargaining, with the proportion of employees covered by collective agreements increasing from 39.8 per cent of the workforce in 2008, to just 43.4 per cent in 2010.

Dr Forsyth and Professor Stewart argue many of these new agreements are effectively non-union instruments drafted by employers to replace the individual workplace agreements formerly available under Work Choices.

Genuine collective bargaining is likely to be confined mainly to large, unionised workplaces in the public sector and to some sections of the private sector.

Much of the bitter complaint about Fair Work comes from the miners. The labour lawyers say what some employers in the resources sector are seeking is a capacity to manage their businesses without the involvement of unions, and to undertake projects entirely free of any threat of industrial action.

‘These aspirations are simply not compatible with the principle of freedom of association … Indeed, to allow them to be fully realised would involve restrictions on the taking of industrial action, or on union rights of entry, that would go far beyond anything envisaged by the Howard government, even during the Work Choices period,” they say.

Talk of Fair Work having unnecessarily bolstered ”union power” should not only be kept in proportion but understood in the context of a broader ideological agenda that is profoundly antithetical to the principle of collectivism, they conclude.